Chicago Board of Trade Market News
Outlook: USDA will publish their Grain Stocks report next Tuesday, but the content of that report is expected to have limited impact on feed grain prices since the final average U.S. corn yield and harvested acreage numbers remain uncertain; both of which will be updated in the October 10 WASDE report. At that time the harvest will also have further progressed. The corn harvest’s pace is presently running about a week behind the 10-year average rate. That delay has not mattered so far because of favorable weather conditions, but concerns could increase if rains next week cause further delays.
Basis is starting to weaken within the Corn Belt harvesting begins in earnest, but remains relatively firm in outlier regions such as the Pacific Northwest. That pricing dynamic is expected to encourage active logistical flow, which could be useful in facilitating full utilization of the nation’s storage capacity.
A similar flow of feed grain inventory is likely to take place in the global export markets as large inventories in the U.S., Eastern Europe and Ukraine flow into the normal global deficit regions, such as Japan, Central America. It could also potentially flow into Brazil if dryness persists in that nation and Argentine corn acreage decreases by an estimated 15 percent. Dryness has also recently intensified in China and the pace of Asian buying of low priced feed grains could accelerate into the new calendar year if the Pacific SOI increasingly points toward El Nino.